The D_1/P_2 is referred to as the: a. capital gains yield b. dividend yield. c. discount rate. d. total return. Harley Davidson (ticker HOG) sells in organized exchanges as well as ECN's (electronic communications networks). Below are the ask price and the bid prices for HOG. Which is NOT TRUE? a. Those willing to buy HOG are willing to pay as much as $53.45 per share. b. Those willing to buy HOG are willing to pay as much as $53.35 per share. c. The bid-ask spread for HOG is 5c. d. The member clearing price for a share is likely between $53.35 and $53.40. The zero dividend growth model is a special case of the dividend growth model. The solution for the zero dividend growth model is all of the following EXCEPT: a. take the dividend paid out and multiply it by 10. b. identical for one used to find the value of a British consol. c. the same one used for finding the price of a preferred stock. d. the formula for a perpetuity Locksmith's is expected to pay an annual dividend of D_1 = $0.78. The stock is selling for $10.90 a share and has a required return of 11 percent. If the DGM is correct, what must be the growth rate of the dividend? a. 3.84 percent b. 3.94 percent c. 4.12 percent d. 4.27 percent Douglas & Daughters just paid an annual dividend of $1 yesterday. The required return is 15 percent and the growth rate is 4 percent. What is the expected price of this stock? a. $11.05 b. $9.09 c. $9.45 d. $13.84